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Alexander Friedman is Chief Executive Officer of GAM. He has also served as Global Chief Investment Officer of UBS, Chief Financial Officer of the Bill & Melinda Gates Foundation, and a White House fellow during the Clinton Administration.

Of the 158 million people on a payroll in the United States... 67% are poor (50 million @15K per year which is poverty level for one person) or near poor... another 55 million 15K to 35K a year... The problem is not Jobs... It's Income... and it's been adequate living income since before the crash... and it certainly was a major factor of the crash of 2008! This costs us Billions just to maintain because of the social consequences of low pay.. in additional crime (incarceration), healthcare (addictions, stress, sickness)... My question is when are you people going to wake up to this fact! “Poverty is the parent of revolution and crime.” ― Aristotle

Central banks started with Mandate A which soon morphed into Mandate B because of "circumstances" and then into Mandate C. We now have zero to negative interest rates which is not a healthy situation. Central banks lack broad perspective being prisoners of the circumstances in front of them. To paraphrase the great Jane Jacobs, central bankers are credentialed but they are not educated. With all the credentials in the world, this will end badly as the die has seemingly been cast.

Why would anybody want a global currency. You may reduce transaction costs but you destroy flexibity. As described in the article the Fed has lost flexibility due to being a reserve currency. A global currency would be even more stymied. Managing your own currency is due to be more problematic, let alone indirectly influencing or being influenced by other economies. There are too many stinking currency baskets to want to get near that role. CBs are intended to attend to local needs - that is their mandate - and by definiton what benefits one locality is usually detrimental to another, hence the downward spiral of ZIRP as CBs compete to hit the lower boundary.

Management of your own currency in a global economy is due to become more problematic as apart from domestic unresolved issues there is the growth of emerging economies. Emerging economies who have major infrastructure problems, climate change impacts, population growth, false expectations, migration pressures, water security isses and often dubious democratic processes - all at play in the global system enhancing instability. That is why there is capital flight from emerging economies.

Currency does not solve dysfunction and dysfunction is the problem and globalisation means dysfunction is near not remote

The Fed is on a hiding to nothing and in a Karpman Drama Triangle. Enjoy

As well as an upside there is a downside to reserve currency status. A reserve status invokes external as well as domestic consideration. Considering external events is simply attempting to look after the domestic scene

'...compelling further reliance on unconventional monetary policy – even beyond the negative nominal interest rates now being pursued in Europe and Japan.'

There is no evidence that neg rates are anything other than a de facto tax putting costs up for borrowers

There is undoubtedly a backlog of potential credit access building with time - currently unwanted, in the same way there is stockpile of cash held by investors and corporations currently unspent. It suggests that when credit is taken the investment is made - that there is a binge potential and it will be very difficult to manage other than by interest increases. That will strengthen the dollar and make exports more difficult. Policy then becomes the legendary donkey that starves to death between to equidistant piles of hay, unable to decide which pile to eat

Current 'management' has been simply throwing loads of money at the system, bottoming rates and letting national debt grow in a denuded landscape. This has assisted, above all, corporations

I havent seen US stats but I would expect US SMEs to be buckling which will put more power in the hands of large corporations who are demonstrably flighty and indulge in offshoring. Policy has to be directed to SMEs as they tend to stay put and offer growth potential. To much corporate activity is simply M&A and platform engineering which is intrinsically degenerative longterm

It wouldn't surprising if increasing interest rates caused skittishness among stock investors before home buyers. But both asset prices would likely collapse eventually. The US is in the same debt trap as the global economy.

Just because thinhs happen at the same time, doesn't mean that they are related or there is a causality between them.

QE was a response to the low interest rates and generalized liquidity preference. The hikes on interest rates from central banks, proved that no matter what they do we will stay at the ZLB, and yelds will flaten, because the root problem is the liquidity preference and monetary policy has nothing to do with it.

In conclusion, the only thing the FED can do is to try an not to look stupid and ignorant, like Yellen did with the rates hike.

Not only has the Fed been loaning trillions at low interest rates to big banks, but the big banks have increased their loans to big companies:
https://ilsr.org/rule/financing-local-businesses/
Lower interest rates increase profits which increases the value of stocks.

I don't know exactly how Europe is lowering rates, but the Fed has been loaning trillions of dollars at low interest rates to the big banks. Lower interest rates have encouraged financial engineering, like M&A, but not IPOs, because the big banks are now controlled by Dodd Frank.

I couldn't agree more with your view, the question is that asset prices are not artificially high, unless you think that interest rates are artificially low...

There are many explanations for the current level of prices; none of them resorts to the term artificial or natural. The use of this term implies a judgment on the economic circumstances which doesn’t help the discussion, even because if those circumstances existed there would be arbitrage opportunities, namely we would be experiencing a surge on IPO’s to take advantage on such “bubble”, but we aren’t.

If the Fed puts global financial markets above the US in whose interests they are supposed to be acting, Both parties will finally agree to an audit and likely take away the Feds authority. If only because the voters are tired of being buggered to advantage multi national corporations who are NOT american an thus not our responsibility. Not to mention previous employer Goldman sachs, current employer US Treasury or Fed Next employer Goldman Sachs I wonder? In whose interests are htese decisions being made it isn't those of the US.

"Helicopter" money would be a second channel for monetary action that would allow you to offset or reinforce anything you did to interest rates in asset markets. "Offset" is the key here; Friedman fears that helicopter money could be used to reinforce the Fed's timidity on interest rates, but it's more likely to be used to sustain stimulus while the Fed dials back its out-sized participation in asset markets.